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Elasticity of corn price transmision and its implication to farmers

Author

Listed:
  • Ahmad Muslim

    (Faculty of Economics, Universitas Al Azhar Indonesia)

Abstract

Corn has important roles to Indonesian economy both for staple foods and for price transmission to other products. The high domestic demand for corn compared to its domestic production has made corn imports continue to grow. This research is aimed to know the elasticity of price transmission and its implication to corn?s farmers. The results of analysis show that corn price transmission is inelastic. The coefficient shows that corn market is oligopsony under the imperfect competition market. To help the corn farmers, the government has to provide fertilizer subsidy and farm credit with low interest rates, as well as impose import tariff on corn

Suggested Citation

  • Ahmad Muslim, 2011. "Elasticity of corn price transmision and its implication to farmers," Economic Journal of Emerging Markets, Universitas Islam Indonesia, vol. 3(1), pages 77-85, April.
    • Handle: RePEc:uii:journl:v:3:y:2011:i:1:p:77-85
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    References listed on IDEAS

    as
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    4. Byeong‐Il Ahn & Hyunok Lee, 2010. "An equilibrium displacement approach to oligopoly market analysis: an application to trade in the Korean infant formula market," Agricultural Economics, International Association of Agricultural Economists, vol. 41(2), pages 101-109, March.
    5. Chia‐Hung Sun, 2010. "The impact of auction characteristics on prices of agricultural products traded online: evidence from cherries," Agricultural Economics, International Association of Agricultural Economists, vol. 41(6), pages 587-594, November.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Corn; Elasticity of price transmission; oligopsony; imperfect competition market;
    All these keywords.

    JEL classification:

    • Q00 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - General
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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